fes fetejos_wiki https://fetejos.shoutwiki.com/wiki/P%C3%A1gina_principal MediaWiki 1.35.13 first-letter Medio Especial Discusión Usuario Usuario discusión fes fes discusión Archivo Archivo discusión MediaWiki MediaWiki discusión Plantilla Plantilla discusión Ayuda Ayuda discusión Categoría Categoría discusión Módulo Módulo discusión Accesorio Accesorio discusión Accesorio definición Accesorio definición discusión 0 1 1 2014-02-12T20:47:06Z MediaWiki default 30443056 wikitext text/x-wiki <big>Welcome to your new site!</big><br/> This is your new site! Feel free to start editing right away! f6aad8bc2928e71e9e507f8fe0955e0ab1782cc4 3 2 2 2014-02-12T20:47:06Z ShoutWiki 11 wikitext text/x-wiki Hi Oicor28, thank you for choosing ShoutWiki to make your wiki. We would suggest that you start your wiki off by doing these few basic things: *Upload a logo. You can do this by uploading an image over [[:File:Wiki.png]]. (not available on some skins) *Design your [[Main Page]]. 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[[s:ShoutWiki Staff|ShoutWiki staff]] 20:47 12 feb 2014 bc558febc46a9829cfd6a873ac73de203280dbb5 0 3 3 2014-02-12T20:47:52Z Oicor28 3371374 Página creada con «drfdsgsdgdfg» wikitext text/x-wiki drfdsgsdgdfg 92547c086a051204dcdd8319097f8b750383da94 4 3 2014-02-12T20:48:33Z Oicor28 3371374 wikitext text/x-wiki Este es un ejemplo de una wikyfgfgf d5cf9c3dca7520f0e8008e7dd0ef7102cedab91c 5 4 2014-02-12T21:21:11Z Oicor28 3371374 wikitext text/x-wiki Este es un ejemplo de una wiky... y solo es un aprueba...... f55f489e314c46d0897cd6497f1e52e35f5305aa 6 4 6 2014-02-12T21:31:41Z Oicor28 3371374 wikitext text/x-wiki da39a3ee5e6b4b0d3255bfef95601890afd80709 0 5 7 2017-09-22T08:10:43Z 111.248.141.108 0 Página creada con «There are actually not one but two different types of leg length discrepancies, congenital and acquired. Congenital means [http://2nia-2-rooze.mihanblog.com/post/353 How do...» wikitext text/x-wiki There are actually not one but two different types of leg length discrepancies, congenital and acquired. Congenital means [http://2nia-2-rooze.mihanblog.com/post/353 How do you treat a sore Achilles tendon?] are born with it. One leg is structurally shorter compared to the other. Through developmental stages of aging, the human brain picks up on the walking pattern and recognizes some difference. Our bodies usually adapts by dipping one shoulder over to the "short" side. A difference of under a quarter inch is not grossly abnormal, doesn't need Shoe Lifts to compensate and in most cases doesn't have a serious effect over a lifetime.<br><br><br>Leg length inequality goes largely undiagnosed on a daily basis, yet this condition is very easily solved, and can eliminate a number of instances of chronic back pain. <br>Therapy for leg length inequality typically involves Shoe Lifts. These are low-priced, often priced at under twenty dollars, in comparison to a custom orthotic of $200 plus. When the amount of leg length inequality begins to exceed half an inch, a whole sole lift is generally the better choice than a heel lift. This prevents the foot from being unnecessarily stressed in an abnormal position.<br><br>Mid back pain is easily the most widespread ailment afflicting people today. Around 80 million men and women experience back pain at some stage in their life. It is a problem which costs employers millions of dollars yearly as a result of time lost and output. New and better treatment methods are continually sought after in the hope of reducing the economical impact this condition causes.<br><br><br>Men and women from all corners of the world suffer from foot ache as a result of leg length discrepancy. In most of these cases Shoe Lifts are usually of worthwhile. The lifts are capable of decreasing any discomfort in the feet. Shoe Lifts are recommended by numerous specialist orthopaedic physicians.<br><br>To be able to support the body in a nicely balanced manner, the feet have a vital function to play. In spite of that, it can be the most neglected region of the human body. Some people have flat-feet which means there is unequal force exerted on the feet. This will cause other areas of the body such as knees, ankles and backs to be impacted too. Shoe Lifts ensure that appropriate posture and balance are restored. c539d03e18172c8aa0c3b18478f20e94722cad53 0 6 8 2017-09-23T04:19:25Z 1.161.121.126 0 Página creada con «Overview<br>A Morton's neuroma usually develops between the third and fourth toes. Less commonly, it develops between the second and third toes. Other locations are rare. I...» wikitext text/x-wiki Overview<br>A Morton's neuroma usually develops between the third and fourth toes. Less commonly, it develops between the second and third toes. Other locations are rare. It also is rare for a Morton's neuroma to develop in both feet at the same time. The condition is much more common in women than men, probably as a result of wearing high-heeled, narrow-toed shoes. This style of shoe tends to shift the bones of the feet into an abnormal position, which increases the risk that a neuroma will form. Being overweight also increases the risk of a Morton's neuroma.<br><br>Causes<br>A Morton's neuroma commonly occurs due to repetitive weight bearing activity (such as walking or running) particularly when combined with tight fitting shoes or excessive pronation of the feet (i.e. "flat-feet"). The condition is also more common in patients with an unstable forefoot allowing excessive movement between the metatarsal bones. A Morton's neuroma can also occur due to certain foot deformities, trauma to the foot, or the presence of a ganglion or inflamed bursa in the region which may place compressive forces on the nerve.<br><br>Symptoms<br>Morton's neuroma can cause a very painful burning or sharp pain in your foot that feels worse when you walk. It may feel like a small lump inside the ball of your foot. It is usually between the third and fourth toes, but it can also be between other toes.<br><br>Diagnosis<br>In some cases your doctor will be able to feel the Morton's as a swelling in the middle of your foot. However they may also suggest an X-ray or a blood test - this is normally to rule our other causes of the pain such as arthritis. The most accurate way to diagnose Morton?s itself is with magnetic resonance imaging (MRI) or ultrasound.<br><br>Non Surgical Treatment<br>The first line of treatment is to try modifying footwear. Often simply wearing broader fitting shoes can reduce pressure on the neuroma and so reduce pain. Orthotic inserts [http://woorichurch.net/?document_srl=86503 Can exercise increase your height?] also help as they can again help reduce pressure on certain parts of the foot. Padding and taping the toe area is another option. In some cases a steroid injection into the foot may be suggested. This can be done as a day case without the need for anaesthesia and helps reduce inflation of the nerve. It can halt the pain in round 70 % of cases. Sometimes a combination of alcohol and local anaesthesia may be injected as this helps reduce pain.<br><br>Surgical Treatment<br>If other therapies have not worked it may be necessary to perform surgery. As surgery may result in permanent numbness in the affected toe, doctors ten to use this procedure as a last resort. However, in most cases surgery is extremely effective. The patient usually receives a local anesthetic. Surgery involves either removing the nerve, or removing the pressure on the nerve. Two surgical approaches are possible. The dorsal approach, the surgeon makes an incision on the top of the foot, allowing the patient to walk soon after surgery, because the stitches are not on the weight-bearing side of the foot. The plantar approach, the surgeon makes an incision on the sole of the foot. In most cases the patient will be in crutches for about three weeks. The resulting scar may make walking uncomfortable. However, with this approach the neuroma can be reached easily and resected without cutting any structures. There is a small risk of infection around the toes after surgery. 63153f420e7980afdc067c1f5b5e0a10d53d3d29 0 7 9 2018-05-04T11:30:00Z 111.248.129.204 0 Página creada con «The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters...» wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out choc of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. 4e6e43905c5d33fb02c5d3c3eeb61faf87f54016 10 9 2018-05-06T15:32:11Z 111.248.140.32 0 wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 choc billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. b7efdc529928b1c61a2073ce5e7adb4919373b10 11 10 2018-05-06T15:53:47Z 111.248.140.32 0 wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. 837bf5ff6a617f04b67fe2807d7ecab59dd0460c 12 11 2018-05-06T15:55:36Z 111.248.140.32 0 wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes choc armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. 42a338a0b787b033b300e7f5f99aeab46fd60a4d 13 12 2018-05-06T15:56:24Z 111.248.140.32 0 wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. 837bf5ff6a617f04b67fe2807d7ecab59dd0460c 14 13 2018-05-06T16:24:26Z 111.248.140.32 0 wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When choc Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. 0b89351971b98f5df0d563892897b5d4fc00c4ae 15 14 2018-05-06T16:52:17Z 111.248.140.32 0 wikitext text/x-wiki The chilly streets of Hershey, Pennsylvania, are quiet now. It's nothing like the summers, when hordes of tourists pour in, bringing their children to ride roller coasters in Hershey Park and see the lampposts shaped like Hershey's Kisses. They're absent the spectacle that happens every few years, when deal talk bubbles, and journalists try to quickly imbue themselves in the quirky company called Hershey. For now, the town is out of the spotlight and quietly working on something it's never mastered: change.<br>Without Hershey's controlling shareholder, a charitable trust that supports a school for underprivileged children, Hershey would have long ago sold. That is the view of most experts. Its competitors are now larger and more diversified. Hershey's brands remain strong but the company is vulnerable to the whims of the U.S. chocolate business. Absent selling, it must transform on its own. Hershey's plan: Take all of its strengths and clout as the country's No. 1 chocolate company and use them to reinvent itself as a snacking company. The U.S. is being overtaken by one-handed eaters and Hershey wants a much bigger bite of the $88 billion snacking industry.<br><br>That means making its own classic chocolate products more snackable. It also means buying new snack brands, some without any chocolate. It recently forked over $1.6 billion for SkinnyPop-parent Amplify, its largest deal yet. All the while, Hershey will continue to fiercely defend its profitable and powerful chocolate business.<br><br>It already ranks second in snacks, behind PepsiCo, by virtue of being the nation's largest chocolate company, argues its CEO, Michele Buck.<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br>Bradley C. Bower , Bloomberg , Getty Images<br>The original Hershey Co. chocolate manufacturing plant and Hershey Park Entertainment facility, foreground, in Hershey, Pennsylvania on Wednesday, Nov. 25, 2009.<br><br>It is a compelling plan. But also as predictable as Hershey's summer tourists. Hershey has tried to move beyond chocolate over and over. Often the shifts are short-lived. It has dabbled with pasta companies, macadamia nuts, cookies, diet bars, and even ran a restaurant chain, Friendly's ice cream parlor, for a while. It always retreats.<br><br>Hershey no longer has the luxury of failure.<br><br>U.S. chocolate this year grew at a rate of only 0.7 percent, according to Nielsen. Hershey has been losing market share and there are now emboldened, deep-pocketed competitors attacking its core. It's lowered its long-term sales growth targets twice in two years. Cocoa prices are rising. It's in need of growth.<br><br>Its competitors are now larger and more diversified. M&M-owner Mars, for example, acquired gum company W. Wrigley for $23 billion in 2008 after Hershey rebuffed the gum maker's overtures. It's significantly grown its pet business as a counter to the challenges facing the candy industry. Mondelez, meanwhile, acquired England's Cadbury for $19 billion in 2010 (back when it was still Kraft), after Hershey decided it couldn't afford a joint bid for it. Mondelez now has a market cap of around $60 billion. Hershey is at $25 billion.<br><br>"Confectionery companies are realizing they lived in a bubble — a privileged category, isolated from the day's trends. There has been a wake-up call that no category is immune to the challenges facing the food industry, and now they're all looking for growth," said Nicholas Fereday, executive director of food and consumer trends at investment bank Rabobank.<br><br>So, out of the spotlight, on the quiet streets of Hershey, Buck is trying to introduce change. All the while, she's trying to balance a controlling shareholder, a school with a mission and a town tied to its traditions.<br><br>"As we look at all that's going on in the world around us — our job as leadership is to transform the company and capture that growth," said the 56-year-old Buck. "When I think about transformation, I think about it relative to the portfolio — brands and products — I think about it relative to the channel, because consumers are shopping differently, and we need to reach them wherever and however they're shopping."<br><br>A town called Hershey<br><br>Dave West, who was CEO of Hershey in the late 2000s, brazenly got rid of free chocolate at the company's annual shareholder meetings. He didn't think it was necessary to give it away and instead handed out a discount for the nearby Hershey's Chocolate World attraction.<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br>Bradley C. Bower , Bloomberg , Getty Images<br>An historic marker stands outside the original Hershey Co. chocolate manufacturing plant in Hershey, Pennsylvania.<br><br>Investors were vexed. The elimination of that free chocolate became as big of a question as company performance at its annual meetings. When J.P. Bilbrey later became CEO, at the first annual meeting he presided over, he announced he was bringing back the free chocolate. The room rose to a standing ovation.<br><br>That is the tightrope Hershey walks: change is rarely greeted as enthusiastically as a return to tradition.<br><br>Hershey, Pennsylvania, retains the same idealism that Milton Hershey imbued in it when he founded his namesake empire there in 1894. Streets still have names like Chocolate Avenue and Cocoa Avenue. It is still a complex interwoven web of Hershey entities, which shape the town's culture.<br><br>Hershey's largest and controlling shareholder remains The Hershey Trust, a trust set up by Milton Hershey to support a school for orphans, since expanded to children of need. The goal of the trust, per an oft-cited deed, is to ensure that the school is funded in perpetuity.<br><br>That trust, which holds its meetings in a mansion in which Milton Hershey used to live, does not direct the company's strategy. It has three representatives on the company board. As its controlling shareholder, it decides whether Hershey remains independent.<br><br>The trust has other investments, but Hershey is its largest. It has long grappled with whether the best way to fulfill its mission is to rely heavily on a company that primarily makes its money in one product, chocolate.<br><br>In 2002, the trust worried it needed to diversify. It put Hershey up for sale and had a handshake $12.5 billion deal to sell to gum maker Wm. Wrigley Jr. Co., sources say.<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br>Tim Shaffer , Reuters<br>Yard signs protesting the proposed sale of Hershey Foods are lined along Caracas street in Hershey, Pennsylvania, September 3, 2002.<br><br>But the town that Milton built revolted, worried about jobs and his legacy. As M&A bankers drove down to Hershey, Pennsylvania, police blocked them from checking into the hotel. At the last minute, the trust reversed course and called off the deal.<br><br>In 2007, drama once again descended on the town. The trust accused then-CEO Rick Lenny of being unforthcoming about deal talks with Cadbury and company performance, according to media reports at the time. Boiling tensions led to the resignation of Lenny and several board members.<br><br>In 2016, there was another takeover bid, this time from Oreo-owner Mondelez International. Hershey rebuffed the offer over price before it ever went to the trust, sources say.<br><br>"The boards of the Hershey Trust Company and the Hershey Company enjoy a strong working relationship," said the chairman of the trust, Robert Heist in a statement.<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br>The Hershey Library , the Patriot-News , AP<br>Chocolate magnate Milton S. Hershey and Catherine Hershey pose for a formal studio portrait taken in Nice, France in 1910.<br><br>"There has never been and never will be any informal back-and-forth between our two entities regarding the Hershey Company's strategy, management and merger and acquisition transaction decisions. The Hershey Trust Company has a strong interest in the long-term health and success of the Hershey Company."<br>New guard arrives<br><br>Michele Buck was a marketing executive who rose up the ranks at Kraft. She worked with Rick Lenny when she was at the snack company and joined Hershey in 2005 under Lenny's tenure as CEO.<br><br>In a town wary of outsiders, Buck has the right pedigree. Locals note with approval, that she was born in central Pennsylvania, went to Pennsylvania's Shippensburg University and sent her children to Hershey schools. Sources say she has strong relations with the Hershey Trust.<br><br>Industry executives are impressed with her marketing, presentation and communications skills.<br><br>Buck has helped shape its snacking initiatives. She was the architect of acquisitions of its beef jerky brand Krave and chocolate snack company BarkThins — spending roughly $500 million in total on those.<br>Michele Buck<br>Source: Business Wire<br>Michele Buck<br><br>"She has history and legacy here, and has really grounded herself in the purpose of the company, but has a bold new vision," said Todd Tillemans, president of the company's U.S. business.<br><br>After decades of controversy and infighting at the Hershey Trust, turmoil has also subsided. A reform agreement in 2016 led to the resignation of some of its more irascible figures. It has new leadership and has made some key hires, including James Katzman, a retired Goldman Sachs Group partner.<br><br>Upon taking the CEO seat a year ago, Buck has brought in a number of new senior executives, including Chief Growth Officer Mary Beth West, who comes armed with snacking experience from Mondelez; Tillemans, who brings more than two decades of experience from Unilever; and Chief Digital Commerce Officer Doug Straton, also of Unilever, who brings with him e-commerce experience as Hershey builds its online strategy.<br><br>"You need people who are willing to think differently," said Buck. "Who are not just going to execute the status quo."<br><br>The reverence, though, for Milton Hershey remains.<br><br>"People talk of 'Mr. Hershey,' and it almost feels like he just left the room," one former employee recalls. "Then you realize he died in 1945."<br><br>Hershey is changing how it's structured, creating its first cross-functional e-commerce teams. The company is thinking differently about distribution, looking for points of sale outside the typical store walls. It's changing how it's marketing, driving a massive social media campaign for Hershey Gold during the Olympics.<br><br>Tweet <br><br>It has also begun to more openly discuss the legacy of the school it funds, calling itself the original purpose-driven company. It only began to allude to the Hershey mission nine years ago on the back of its chocolate wrappers.<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br>Source: Hershey's<br>Hershey's Milk Chocolate Bar wrapper now calls out Milton Hershey's legacy.<br><br>"We are letting loose a little to let consumers in," said West.<br>Lessons learned and going big<br><br>The lab where Hershey concocts its chocolate confections is relatively isolated, aside from a nearby Friendly's, the restaurant chain it used to own in a prior diversification play. At the time, candy was 68 percent of Hershey's sales, according to media reports. Thirty-five years later, chocolate is 80 percent.<br><br>SkinnyPop, though, is different. It's far more in Hershey's wheelhouse than a restaurant. Its brand is strong and it sells quickly in stores, like candy. Not only is SkinnyPop Hershey's largest acquisition outside of chocolate, it's its largest-ever deal. And Buck recently explored an even bigger deal for Nestle's U.S. confection business.<br><br>Hershey has learned what its peers have, which is that small brands get lost and do little to move the needle of a "Big Food" company. SkinnyPop had revenue last year of roughly $332 million, according to Euromonitor, five times that of BarkThins when Hershey acquired it in 2016. It's still, though, a fraction of Hershey's $7.5 billion in annual sales.<br>Snack brands acquired by Hershey's.<br>Lauren Hirsch , CNBC<br>Snack brands acquired by Hershey's.<br><br>Hershey is organizing differently around SkinnyPop than it has in its past acquisitions. It is keeping the popcorn maker's management and headquarters in Austin, Texas, which will be the new center of its small brand strategy. SkinnyPop's scale will provide a bigger base as it expands its presence in the snacking aisle through acquisitions and new products, like its Hershey's Popped Snack Mix.<br><br>"SkinnyPop has continued to lead that market, they just have. When they go on an end cap, they just do volume that no other brand can touch," said John Foraker, CEO of Once Upon a Farm and former CEO of Annie's, who sold the business to General Mills. "They're smart to keep it separate. Leave their entrepreneurial team there, provide the resources they need and just stay out of their way."<br><br>Hershey learned from its stumbles with Krave, the beef jerky brand it bought for $220 million in 2015. Krave was a niche brand and Hershey learned that what might be popular in New York may not extend to a small town in Middle America. It also was a young brand and it didn't have the same license to introduce creative flavors. A chocolate bar with Reese's inside it is exciting; a chipotle cherry beef Krave bar has more limited appeal.<br><br>"Whenever you branch out a little bit, you're not going to get everything perfectly right the first time, and we certainly haven't," Buck said. "But we have learned from some of the things we've done and I feel like we've applied those in each acquisition and innovation going forward."<br><br>Hershey views its snacking drive as an extension of its strengths — chocolate was, after all, the original snack. It is simply looking for ways to make its products, including chocolate, more snackable throughout the day. It's adding nuts and savory elements to make "snackfection" combinations of savory and sweet. It's different than that time Hershey launched SmartZone diet bars, because Hershey isn't trying to turn chocolate into an entirely new product.<br><br>The theory is: take the clout over retailers that Hershey has as the country's top chocolate company and choc broaden it to other snacks. Chocolate sales are growing slower than they used to, but those profitable impulse buys are still important to merchants.<br><br>"We have taken our portfolio and mapped exactly how we serve the consumer at those different demand moments and how do we find incremental places to expand, relevant to our touchpoints," Tillemans said.<br><br>It's a similar rational to when Hershey bought premium chocolate company Scharffen Berger 13 years ago.<br><br>Chocolate is the third-biggest single-serve snacking category, according to Nielsen. It is growing at a rate of 1 percent. Salty snacks are growing 6 percent, cookies/crackers 6 percent and jerky 5 percent.<br><br>There is a guardian of salty snacking and its name is PepsiCo, but Hershey is not concerned that the No. 1 popcorn brand, Smartfood, is owned by Pepsi's Frito-Lay business. The $15.8 billion unit has delivered 3 percent sales and 6 percent profit growth over the past three years, the company told analysts in February.<br><br>"We think about it less in terms of how are we going to compete against Frito-Lay and more about how do we build the opportunity," said Buck.<br><br>"The category is still growing, and we do offer this product in a different location in the store, and frankly some of the products are positioned differently."<br><br>Still, popcorn is less profitable than chocolate. When Hershey tried to go into cookies, another lower-margin business, Nabisco fiercely defended its market share, recalls Jim St. John, who oversees Hershey's product innovation at the lab near Friendly's.<br><br>"Unfortunately, we woke up Nabisco," he said. "They're just big and they spend big in that area."<br>US chocolate, a nagging concern<br><br>The truth is, even Milton Hershey worried that U.S. chocolate alone would not be enough to sustain his business long term.<br><br>In 1929, he had crafted a deal to merge his namesake chocolate empire with Kraft Phenix Cheese Corporation and Colgate-Palmolive-Peet company, but the plan was scuttled by the Great Depression.<br><br>The end of that story is often that chocolate got the town through the Great Depression, a savior to central Pennsylvania amid a country in its throes.<br><br>The postscript, though, is that concern has lingered since 1929. There have been three solutions: broaden the company's size, its products or its global reach.<br><br>Efforts at the latter have been challenged. Hershey weighed teaming up with Italy's Ferrero to buy England's Cadbury in 2010, but the deal was too expensive. The push under J.P. Bilbrey, who joined Hershey armed with international experience from Procter & Gamble, was to once again look for growth globally.<br><br>His acquisition in 2014 of Shanghai Golden Monkey Food Joint Stock in China — meant to be its launching pad into the region — was a disappointment. The founder left early on and the chocolate market dipped.<br><br>Now, with the global confectionery market dominated by players like Nestle, Mars and Mondelez, it's tough to cobble together an international platform. (The U.K. chip business Tyrrells that Hershey bought as part of Amplify is under review, Buck said.)<br><br>"We've identified the U.S. as our No. 1 priority," said Buck. And in that, chocolate still gets top billing.<br><br>"There's this pendulum that swings at Hershey," noted the former Hershey employee.<br><br>Shortly after it announced its acquisition of Amplify, Hershey placed an even larger bid for Nestle's U.S. candy business, which includes brands like Butterfinger.<br><br>"We look to strengthen our core business because it's critically important to us. So, there may be some acquisitions that could create potential growth, but also provide a lot of cost synergies ... and there will be others that might be more about revenue growth," Buck said, not referring to the Nestle business directly.<br><br>But if Hershey isn't careful, its rivals could outmaneuver it.<br><br>The Butterfinger business went to Italy's Ferrero Group for $2.8 billion. Hershey's emboldened competitor has in the past 18 months slapped its mark on the U.S. in a rapid progression of dealmaking.<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br>Justin Sullivan , Getty Images<br>Hershey lost out to emboldened competitor, Italy's The Ferrero Group, in its bid to acquire Nestle's U.S. business, which includes the Butterfinger and Baby Ruth brands.<br><br>And the full impact of Mars' $23 billion acquisition of Wm. Wrigley in 2008 is only now reverberating. Two years ago, Mars bought out Warren Buffett's stake in the gum company, allowing it to finally combine its gum and candy business. Last year, it announced a new headquarters in Newark, New Jersey, for the combined unit, where its focus will be exclusively on growing its candy brands.<br><br>The $100 million Mars recently spent on the capacity to make caramel M&Ms is a sign of how seriously it's taking its confections.<br><br>Mondelez is making its own chocolate push. In 2016, it launched Milka Oreo candy bars. It too has cited snacking as a focus.<br><br>The new competition has put some analysts on edge. They fear Hershey can't balance its newer snacking offense while protecting its core. They are concerned that slowing U.S. chocolate sales have taken the wind out of Hershey's sails. Bankers chagrin the few snack brands that are both growing and of scale.<br><br>Hershey executives note its core brands continue to grow in the low to mid single digits. It has "top quartile net sales growth" and some of the best margins of its peers.<br><br>"You have to put it all in perspective, things constantly change, and you have to constantly evolve and look at change as an opportunity, not a challenge, as an opportunity," said Buck. 07677c7c3317098a553d66e9776348e66e70cc56